TRADE POLICY REVIEW BODY: REVIEW OF ROMANIA
TPRB'S EVALUATION Back to top

The Trade Policy Review Body of the World Trade Organization (WTO) concluded its second review of Romania's trade policies on 4 and 5 October 1999. The text of the Chairperson's concluding remarks is attached as a summary of the salient points which emerged during the discussion. The review enables the TPRB to conduct a collective examination of the full range of trade policies and practices of each WTO member countries at regular periodic intervals to monitor significant trends and developments which may have an impact on the global trading system.

The review is based on two reports which are prepared respectively by the WTO Secretariat and the government under review and which cover all aspects of the country's trade policies, including its domestic laws and regulations, the institutional framework, bilateral, regional and other preferential agreements, the wider economic needs and the external environment. A record of the discussion and the Chairperson's summing-up together with these two reports will be published in due course as the complete trade policy review of Romania and will be available from the WTO Secretariat, Centre William Rappard, 154 rue de Lausanne, 1211 Geneva 21.

Since December 1989, the following reports have been completed: Argentina (1992 & 1999), Australia (1989, 1994 & 1998), Austria (1992), Bangladesh (1992), Benin (1997), Bolivia (1993 & 1999), Botswana (1998), Brazil (1992 & 1996), Burkina Faso (1998), Cameroon (1995), Canada (1990, 1992, 1994, 1996 & 1998), Chile (1991 & 1997), Colombia (1990 & 1996), Costa Rica (1995), Côte d'Ivoire (1995), Cyprus (1997), the Czech Republic (1996), the Dominican Republic (1996), Egypt (1992 & 1999), El Salvador (1996), the European Communities (1991, 1993, 1995 & 1997), Fiji (1997), Finland (1992), Ghana (1992), Guinea (1999), Hong Kong (1990, 1994 & 1998), Hungary (1991 & 1998), Iceland (1994), India (1993 & 1998), Indonesia (1991, 1994 & 1998), Israel (1994 & 1999), Jamaica (1998), Japan (1990, 1992, 1995 & 1998), Kenya (1993), Korea, Rep. of (1992 & 1996), Lesotho (1998), Macau (1994), Malaysia (1993 & 1997), Mali (1998), Mauritius (1995), Mexico (1993 & 1997), Morocco (1989 & 1996), New Zealand (1990 & 1996), Namibia (1998), Nigeria (1991 & 1998), Norway (1991 & 1996), Pakistan (1995), Paraguay (1997), Peru (1994), the Philippines (1993 & 1999), Poland (1993), Romania (1992 & 1999), Senegal (1994), Singapore (1992 & 1996), Slovak Republic (1995), the Solomon Islands (1998), South Africa (1993 & 1998), Sri

Lanka(1995), Swaziland (1998), Sweden (1990 & 1994), Switzerland (1991 & 1996), Thailand (1991 & 1995), Togo (1999), Trinidad and Tobago (1998), Tunisia (1994), Turkey (1994 & 1998), the United States (1989, 1992, 1994, 1996 & 1999), Uganda (1995), Uruguay (1992 & 1998), Venezuela (1996), Zambia (1996) and Zimbabwe (1994).

TRADE POLICY REVIEW BODY:   REVIEW OF ROMANIA
CONCLUDING REMARKS BY THE CHAIRPERSON Back to top

We have had very informative discussions on Romania's trade regime, allowing Members an appreciation both of the challenge of transition in Romania and the contribution of trade policy reform to results to date, in particular steps toward establishing a market economy with a clear legal framework. Members uniformly welcomed Romania's active and constructive role in the multilateral trading system. Romania's tariff commitments in the Uruguay Round were comprehensive, and were followed by WTO commitments on ITA products and on telecom and financial services. Romania has removed quantitative export restrictions and has not taken trade defence measures under the multilateral trade agreements. Members also appreciated the progress by Romania on the regulatory framework for private sector development, but were aware that instability of key elements of the business regime appeared to be adversely affecting the perceptions of foreign direct investors. Privatization efforts have been redoubled in recent years, and have contributed to a rise of foreign investment, albeit from a low base. They also took note of the more difficult external environment for Romania's reforms in recent years, due to the east-Asian and Russian economic crises, as well as recent events in the Balkans including, inter alia, the consequence of embargoes.

Together with the internal challenges of transition, these external events have contributed to the ongoing recession and the deteriorating balance of payments. The latter occasioned the introduction of a temporary surcharge in October 1998, but which is scheduled to be phased out by 1 January 2001 at the latest. Romania's recently concluded agreements with the IMF and World Bank indicate confidence in the Government's policy mix of tight fiscal and monetary policy, combined with an acceleration of structural reform. They should also help increase the confidence of investors.

In addition to these general points, Members were grateful for the comprehensive explanation given by the Romanian delegation on many specific points, including:

(a) the finalization of privatization and the discretionary nature of the new regime of incentives for large investments, taking into account the international context;

(b) the competition policy and its impact on state aids;

(c) the complementary relationship between Romania's regional trade agreements and its multilateral commitments, and in particular the effect of tariff removal on high-rate items from preferential trade partners on third countries' access to the Romanian market;

(d) the gap between applied and bound rates, in particular on agricultural products, which may create uncertainty for exporters;

(e) customs clearance procedures, in particular the relation between fixed prices for customs valuation of certain products and WTO commitments;

(f) excise tax reductions on domestically-produced cigarettes and motor vehicles in relation to national treatment;

(g) the scope of technical requirements on imported products and the adoption of European or international standards;

(h) price controls on insurance products and pharmaceutical products;

(i) reform of government procurement policies and Romania's willingness to accede to the Government Procurement Agreement;

(k) the role of small and medium-sized enterprises;

(l) policies in the agricultural sector;

(m) the law on television broadcasting requirements and GATS commitments;

(n) limits on the supply of services on the Romanian market, in particular on insurance and financial services; and

(o) measures ensuring consistency of intellectual property rights regulation and TRIPS, together with steps to improve enforcement.

Members appreciated that, in spite of the difficult internal and external environment, Romania faced in its transition to a market economy, it has maintained an open trade regime while aware of the social impact. Members noted the concerns of Romania about certain measures maintained by trading partners, that have an inhibiting effect on its exports, such as anti-dumping or countervailing measures and quotas on clothing.

In conclusion, the Members complimented Romania on its strong commitment to the WTO, reflected both in the conduct of its trade policy and in its active participation in the preparation for Seattle. Members welcomed Romania's intention to participate actively in the forthcoming negotiations, noting in particular its interest in agricultural policies and industrial tariffs. They also urged Romania to continue with the structural reform begun in 1989, particularly privatization. Noting the difficult external environment for Romania of recent years, Members pledged their full support to Romania's efforts.